A 20 percent change in net sales will result in a 20 percent change in net income. Choose... Choose... 4 In a common-size income statement, each item is expressed as a percentage of net sales. Choose... In a common-size balance sheet, total assets are represented by 100 percent. Choose... The pricelearnings (P/E) ratio is an indication of investor confidence in a company. Choose.... The index number used in trend analysis is computed by dividing the base year amount by the index year amount, and multiplying that result by 100. Vertical analysis is the same as common-size analysis. Choose.. Choose... 4 The sale of plant assets and the payment of dividends will reduce free cash flow. Choose... Both profit margin and asset turnover affect a company's return on assets. Choose... - In a common-size income statement, net income is represented by 100 percent. Trend analysis requires the establishment of a base year for comparison purposes. Choose